Nature-Related Disclosures: The ISSB Has a Path Forward
May 14, 2026
Last month, the International Sustainability Standards Board (ISSB) settled a question it had been working toward for two years: how will nature-related risks and opportunities be incorporated into global sustainability reporting standards?
The answer came at the ISSB’s April board meeting in Beijing. The board agreed to develop nature-related disclosure requirements in the form of an IFRS Practice Statement, a structured guidance document that will sit alongside the existing IFRS S1 and S2 frameworks, without amending either. An exposure draft is targeted for public consultation in October 2026[1].
Why nature, and why now
Biodiversity is an indicator of functional, productive and resilient ecosystems. Increasingly, the consequences of their degradation are visible: water shortages disrupting supply chains from agribusiness to semiconductors, and forest loss threatening the long-term security of key commodities.
Regulators are taking note. In 2022, the Network for Greening the Financial System (NGFS), representing over 125 central banks and financial supervisors, concluded that nature-related risks have significant macroeconomic implications for individual financial institutions and for financial stability broadly[2]. Businesses are also feeling the impact directly — companies that have not managed their nature-related risks have faced permit refusals, lawsuits and deteriorating credit ratings.
In this context, the ISSB added a research project on biodiversity, ecosystems and ecosystem services (BEES) to its work plan in April 2024, informed by investor feedback received through its 2023 Consultation on Agenda Priorities, which indicated that investors are increasingly factoring BEES-related considerations into their decision-making[3].
What the ISSB decided and what it means
The ISSB considered four possible approaches to standard-setting for nature-related disclosures: 1) amendments to IFRS S1 (General Requirements for Disclosures), 2) amendments to IFRS S2 (Climate-related Disclosures), 3) a new stand-alone ISSB Standard, or 4) an IFRS Practice Statement. In a staff paper published alongside the decision, the ISSB compared these approaches across structure, mandatory status, effective date, and effect on jurisdictional adoption[4].
The chosen form is the Practice Statement. It is non-mandatory by design, though a jurisdiction can choose to mandate it and an entity can choose to apply it voluntarily. Unlike amendments to S1 or S2, it does not require jurisdictions to reconsider their adoption of existing standards, making it non-disruptive to the significant implementation work currently underway globally. Entities that apply it in full can state compliance with it.
The ISSB has been clear that this is not a lesser outcome. As ISSB Chair Emmanuel Faber stated: “Providing material nature-related disclosures is not optional; IFRS S1 already requires that. A Practice Statement will guide companies on how to provide such disclosures”[5].
Applying it carries the full effect of an ISSB Standard for those that do. It also preserves a pathway to a full standard-based outcome in the future, and the exposure draft will specifically invite stakeholders to comment on whether the Practice Statement form is the right approach.
The Practice Statement will draw substantially on the TNFD framework. In response to the ISSB’s decision, the TNFD has agreed to pause further independent technical guidance development and direct its remaining efforts toward supporting the ISSB’s process.
How can cress help?
Understanding where nature-related risks are material to your business is the starting point. Cress can help your business conduct a double materiality assessment to evaluate both your impact on nature-related issues and the potential for these issues to affect your financial performance.
Please get in touch or request a call with one of our team to learn more.
Cress is the Hydroflux Group’s in-house sustainability consulting team, operating as a specialised division and driven by a simple but powerful goal: to help organisations across Australia, New Zealand and the Pacific region create a more sustainable future. As a young and agile team, we combine technical expertise with fresh, forward-thinking approaches to help clients navigate complex challenges across climate risk, emissions reduction, modern slavery, water stewardship, and ESG reporting, building on the Hydroflux legacy of engineering excellence while bringing a sustainability lens to the industries and communities shaping the future of our region.
[1] The ISSB’s exposure draft on nature-related disclosures is expected in October 2026, aligned with the Convention on Biological Diversity COP17. Source: TNFD welcomes ISSB decision on nature-related standard setting drawing on TNFD framework as adoption crosses 730 organisations and USD 22 trillion in AUM (2025)
[2] TNFD (n.d) Why nature matters: The fundamentals of nature and why it matters to the global economy
[3] Xu A, Yoon N and Li A (2025) Biodiversity, Ecosystems and Ecosystem Services (BEES) Disclosure Practices: Observations in Australia and Korea, AASB–KSSB Research Report.
[4] IFRS (2026) Nature-related Disclosures | Form of standard-setting, Staff paper
[5] IFRS (2026) ISSB agrees on the proposed way forward for nature-related disclosures
